Ex-Qualcomm exec pleads guilty to insider trading

A former Qualcomm sales director pleaded guilty Thursday to one count of insider trading in connection with the San Diego technology giant’s $3.1 billion acquisition of Atheros Communications.

Robert William Herman, who was director of the North America sales division, was one of six charged in San Diego federal court with insider trading in the deal.

According to court records, Herman and co-workers Derek Cohen and Michael Fleischli were part of an informal stock trading group and sometimes shared tips on the market. Herman admitted to repeatedly hearing about a major acquisition from his direct supervisor, who emphasized that the information was secret, according to the plea agreement.

On Jan. 4, 2011, Herman and his co-workers learned the company was Atheros.

He and Cohen discussed the development on the phone, then Herman bought 4,000 shares of Atheros at a total of $148,680, the plea agreement states. News of the acquisition went public later that day, and Herman later sold the shares, which had increased in value, for a profit of more than $29,000, prosecutors say.

He is set to be sentenced Nov. 21.

Cohen and Fleischli, who worked in the same sales group, were also charged. Cohen has pleaded not guilty. The U.S. Attorney’s Office agreed to defer prosecution of Fleischli in exchange for his cooperation in the related investigations. He must also pay a $3,000 penalty, not act as an officer of a public company or participate in the stock market.

Jing Wang, a former Qualcomm executive vice president, was also charged and has admitted to insider trading and money laundering for using an offshore company to hide his stock trades. His brother, Bing Wang of China, and his former Merrill Lynch stockbroker, Gary Yin, were also charged. Yin has pleaded guilty, as well.